SoftBank sees major potential for data collection via android

Like many companies, SoftBank is in the early stages of experimentation with robotics. It developed Pepper, a small so-called “emotional” robot that is able to interact with humans in a relatively natural way, two years ago. Three months ago it put Pepper on sale to the public in Japan for the first time, selling out of its initial 1000 units in the space of a minute.

More importantly though, SoftBank sees strong potential for the humanoid machine to develop as a function of its marketing: it has around 120 units in action in its mobile-phone outlets, and last year also extended sales of the robot to Nestlé. The FMCG giant has employed Pepper to help it sell Nescafé in Japan, the product’s biggest market.

Customer draw

Tatsuro Kurisaka, VP of SoftBank’s advertising division and GM of brand management for the group, said deploying Pepper to selected outlets had led to an increase in customer visits of between 120 and 150 per cent.

“Customers want to see and talk to Pepper, and hear good news from Pepper, and that makes for increased customer traffic to the shops where Pepper is,” Kurisaka said.

He explained that SoftBank was currently using Pepper purely as a promotional tool to greet customers and add an element of fun to their in-store experience, which is possible given its novelty status. The robot has also served as an ambassador in SoftBank’s TV commercials. But Kurisaka noted Pepper’s potential to gather customer data in a way that would never be possible for a human sales clerk.

Tatsuro Kurisaka and Sean McKelvey of SoftBank at Spikes Asia 2015

“In the future, we will be able to gather data from Pepper when customers talk with him, and feed that data from our shops directly into headquarters,” Kurisaka said. “[Pepper] could record how the customer acts in our shops—for example, if there are many questions about the iPhone or iPad. Thousands of Peppers could each provide us with big data—real world big data in one second. I think this is the most advanced form of AI marketing.”

Sean McKelvey, a member of SoftBank Robotics’ product division, who was directly involved in developing Pepper, confirmed that the company “wants to expand in that direction”. He said Pepper’s “personable character” was key in that it encouraged people to behave naturally, but said discretion was important with regard to data collection.

“We want to deliver the added value of AI marketing and maintain an emotional relationship with individual customers, but not violate the relationship Pepper has with the people he talks to,” McKelvey said.

Neutral sales assistant

Kurisaka said he believed it was entirely possible for people to form an emotional bond with a humanoid robot, especially given the fact that Pepper is able to build on the input from conversations by processing information to respond in a seemingly natural way. He suggested consumers might even be more willing to interact with a 'friendly' machine than with a human salesperson. Indeed, McKelvey said when SoftBank first developed Pepper, “we didn’t realise that people were so ready to be comfortable with the experience”. That meant accelerating various features to catch up with consumers.

“When you go to a shop, you see the shop staff as always trying to sell you something,” Kurisaka said. “But a robot you can run away from,” he said. “People see it as talking with a friend, so it’s easier [for them] to get good information from a robot.”

But McKelvey insisted SoftBank was not looking to replace its existing shop staff with androids. Rather, he said, it aimed to augment the customer experience. “Shops that have Pepper actually need more people to deal with increased traffic, so Pepper is actually creating jobs,” McKelvey noted.

It seems likely that Pepper will become a more widespread feature of life both in consumer life in the marketing industry itself. A production company in Tokyo, for example, recently took Pepper on as a “staff member” as a means of familiarising its human employees with robots in anticipation of a new era of technology. Much as in the SoftBank outlets however, the robot is so far just at the ‘meet and greet’ stage, moving between group company offices and exchanging pleasantries with staff.

Of course, not everyone wants to become friends with a robot. In Japan’s Kanagawa prefecture, a 60-year-old SoftBank customer was recently arrested for assaulting a Pepper in-store after becoming upset with the shop’s service. So what happens when the novelty of Pepper wears off? McKelvey said SoftBank plans to continually update the robot to ensure it moves with consumers and remains interesting. It currently offers around 160 applications for B2C users of the robot.

Obese robo-celebrity unlocks new revenue stream

Agencies are also getting in on the action. Dentsu is credited with developing the world’s first celebrity android—‘Matsuko-Roid’—modelled on a cross-dressing Japanese TV personality, Matsuko Deluxe. In a similar way to Pepper, the robot is able to read speech and gestures and respond in a lifelike manner.

The robot is close enough to reality to be able to stand in for Matsuko Deluxe for promotional activities. Hirofumi Hayashi, a creative director at Dentsu in charge of Matsuko-Roid’s creative expression and overall promotional strategy, explained that Matsuko-roid was developed as a new means of drawing revenue from clients. While Matsuko Deluxe is obese and does not travel outside Tokyo, Hayashi explained, the robot double is able to travel to shoots around the country without difficulty. In one instance, Matsuko Deluxe was occupied with filming for one brand as Matsuko-roid endorsed another.

Matsuko-Roid looms on the screen at Spikes Asia. The android was too big to travel outside Japan, Dentsu said

“Matsuko the original celebrity is very busy—and huge,” Hayashi said. “We thought this would be a way to create a new celebrity business … The client pays the fee to Matsuko, but Dentsu also gets a cut from the android.”

Brands to have used the artificial Matsuko include KFC and Recruit. It has also appeared alongside Arnold Schwarzenegger. There are limitations even to Matsuko-Roid's mobility however: the android was apparently too big to travel to Spikes in Singapore. Hayashi sees scope for Dentsu to grow the business model with the creation of robotic clones of other celebrities. “We are planning the next one,” he said. “We want to do one in other Asian countries.”

This article is part of the Campaign Innovate series, a collection of articles that examine the way innovation, startups and technology are affecting the advertising and marketing industry.

Campaign Asia-Pacific has also launched the Campaign Innovate competition, an event that aims to provide a platform for Asia-Pacific's startups to pitch to some of the world's biggest brands. The winner will be announced a the Marketing Innovation Summit.